Authored by: Cao Xuchen, Fund Manager of ChiNext AI ETF HuaBao (159363) / Big Data ETF HuaBao (516700) / General Aviation ETF HuaBao (159231) Recently, we have emphasized twice that the market has reached a favorable entry point, recommending attention to bottom-fishing opportunities and the growth-enhancing characteristics of the ChiNext AI sector. Below, we will elaborate from three aspects: first, the overall market outlook following the 4100-point level; second, the pace of domestic AI development; third, the outlook for Hong Kong stocks. First, the overall market outlook after the 4100-point level. From December 19, 2025, to January 9, 2026, the Shanghai Composite Index recorded 15 consecutive positive sessions, climbing above 4100 points, with A-share single-day turnover exceeding 3 trillion yuan. During this period, previously strong optical module leaders underwent continuous adjustment; thus, we can characterize this rally as a "bottom unwinding rally"—the release of trapped low-position筹码, which restored the market's赚钱效应. This effectively narrowed the performance gap between the high-flying "optical modules" and the struggling "bottom-fishing themes," presenting an opportunity for the market to重新select a new main theme for rebalancing, which is immensely beneficial for the 2026 market performance. Overall, we remain optimistic about the 2026 market, particularly the technology stock performance in the first half of 2026, although a moderate pullback after the recent short-term overbought condition is entirely normal. Therefore, if the market experiences a short-term correction, we advise seizing this adjustment opportunity. Concurrently, optical modules (representative ETF: ChiNext AI ETF HuaBao (159363)), which previously moved inversely to the market, might反而strengthen again. Second, the pace of domestic AI. The market has largely reached a consensus that 2026 is the year for domestic AI, but this consensus breeds three major issues: first, excessively high expectations often imply elevated valuations, leading to significant volatility for domestic AI (semiconductors, IDCs, etc.) just before concrete implementation; second, companies represented by GPUs must deliver on earnings in the second half of 2026, otherwise the current valuation environment will be difficult to sustain; third, domestic cloud providers need to resolve two key questions: whether to increase CAPEX and whether to adopt a "train-in-China, infer-in-China" approach. If we confine the domestic AI rally primarily to the first half of 2026, a possible scenario is: after the current period of震荡adjustment, GPU companies experience valuation expansion, breaking out of their trading ranges, and pulling up valuations across the broader semiconductor manufacturing, equipment, and design sectors. Subsequently, the actual order fulfillment situation in the third quarter will determine the ultimate height of this valuation-driven rally. Third, the outlook for Hong Kong stocks. In the fourth quarter of 2025, Hong Kong stocks were the most disappointing sector, but this might be a key reason for their potential outperformance in 2026. Entering January, Hong Kong stock single-day turnover was less than 300 billion HKD, while A-share turnover reached 3 trillion yuan. This implies that if just 10% of A-share capital溢出into Hong Kong stocks, the latter's activity could double—assuming, of course, that the A-share market maintains a favorable trading environment in the first half. Therefore, we believe Hong Kong stocks are currently只差one piece of logical justification; once this logic is修正, a comprehensive and rapid valuation surge could occur. Regarding the direction for 2026, we return to the question of "change versus constants": what has changed and what has remained the same. The constants are: (1) the major industrial trend of strong computing power demand; (2) ample global liquidity in a降息environment. The changes are: (1) By the end of 2026, China's high-end GPU manufacturing capability may be achieved; (2) Both NVIDIA and Tesla are emphasizing Physical AI (autonomous driving and robotics); (3) The US midterm elections could impact global risk appetite. If we focus our perspective solely on the first half of 2026, a distinct characteristic emerges: the major changes are primarily scheduled to materialize in the second half. This suggests that the constants might remain dominant in the first half, likely driving the market primarily through valuation expansion, with new changes commanding extremely high valuation premiums. Overall, from a spatial perspective, we acknowledge the possibility of a short-term market correction, which would present an excellent opportunity for buying on dips. Simultaneously, during corrections in other sectors, ChiNext AI, represented by optical modules, might exhibit反向strength. In terms of allocation, we recommend focusing on investment opportunities in three directions: (1) The ChiNext AI ETF HuaBao (159363), which has a heavy weighting in optical modules, might反而be a favorable destination during market consolidation periods. (2) Closely monitor products focused on the Hong Kong stock direction, such as Hong Kong Internet ETF (513770), Hong Kong Connect Innovative Pharma ETF (520880), Hong Kong Information Technology ETF (159131), and Hong Kong Connect Auto ETF HuaBao (520780). (3) Regarding domestic AI, given the market's relatively good liquidity, server and IDC companies within the big data industry might also experience front-loaded pricing and long-term逻辑博弈. Therefore, it is highly probable that Big Data ETF HuaBao (516700) and similar products will demonstrate synchronized strong performance, akin to STAR Chip and STAR AI, and are also值得重点focus on. Special reminder: Recent market volatility may be significant; short-term gains or losses do not预示future performance. Investors must invest rationally based on their own financial situation and risk tolerance, paying close attention to position sizing and risk management. Risk提示: The funds mentioned herein are issued and managed by HuaBao Fund. Distributors do not assume responsibility for the investment, redemption, and risk management of these products. The fund manager has assigned a risk rating of R4-Medium-High Risk to the Hong Kong Information Technology ETF, Hong Kong Connect Auto ETF HuaBao, Hong Kong Internet ETF, ChiNext AI ETF HuaBao, and Hong Kong Connect Innovative Pharma ETF, suitable for Aggressive (C4) and higher risk profile investors. The fund manager has assessed Big Data ETF HuaBao as R3-Medium Risk, suitable for Balanced (C3) and higher risk profile investors. The composition of index constituents is adjusted according to the index compilation rules; their backtested historical performance does not预示future index performance. The above funds are issued and managed by HuaBao Fund. Distributors do not assume responsibility for the investment, redemption, and risk management of these products. Investors should carefully read the "Fund Contract," "Prospectus," "Fund Product Summary," and other legal fund documents to understand the risk-return characteristics of the funds and choose products that match their risk tolerance. Sales institutions (including the fund manager's direct sales channels and other distributors) conduct risk assessments of the above funds based on relevant laws and regulations. Investors should promptly pay attention to the appropriateness opinions provided by sales institutions and base their decisions on the matching results. Appropriateness opinions from different sales institutions may not necessarily be consistent, and the risk rating results for fund products issued by fund sales institutions shall not be lower than the risk rating results determined by the fund manager. The description of fund risk-return characteristics in the fund contract and the fund risk rating may differ due to different consideration factors. Investors should understand the risk-return profile of the funds and make prudent choices based on their investment objectives, horizon, experience, and risk tolerance, bearing their own risks. The registration of the above funds by the China Securities Regulatory Commission does not indicate its substantive judgment or guarantee of their investment value, market prospects, or returns. Any information appearing in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, any form of expression, etc.) is for reference only. Investors are solely responsible for any independent investment decisions. Furthermore, any views, analyses, or forecasts in this article do not constitute investment advice of any form to readers, and no liability is accepted for any direct or indirect losses arising from the use of this content. The past performance and net asset value of the above funds do not预示their future performance. The performance of other funds managed by the fund manager does not guarantee the performance of the above funds. Funds carry risks; investment requires caution! The MACD golden cross signal has formed; these stocks are performing well! Massive information, precise interpretation, all in the Sina Finance APP. Editor: Yang Ci
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